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Simulations Plus Reports First Quarter FY2019 Financial Results

Simulations Plus, Inc. (Nasdaq:SLP), the leading provider of modeling
and simulation solutions for the pharmaceutical, biotechnology,
chemicals, and consumer goods industries, today reported financial
results for its first quarter of fiscal year 2019, the period ended
November 30, 2018 (1QFY19).


1QFY19 highlights compared with 1QFY18:





Net revenues increased 6.6%, or $467,000, to $7.5 million from $7.1
million






Gross profit increased slightly and remained at $5.3 million






Gross profit as a percentage of revenues decreased from 75.5% to 70.8%






SG&A was $2.7 million, an increase of 12.9%, or $311,000, from $2.4
million






SG&A as a percentage of revenues increased to 36.1% from 34.1%






R&D expense increased 46.8% or $169,000, to $530,000 from $361,000






Income before taxes decreased $495,000, to $2.0 million from $2.5
million






Net income decreased $180,000, or 10.5%, to $1.5 million from $1.7
million






Diluted earnings per share decreased $0.01 to $0.09 from $0.10 per
share





Shawn Oa??Connor, chief executive officer of Simulations Plus, said:
"Strong first quarter revenue growth in addition to key new business
closures after quarter end support our outlook for full year revenue
growth of 10-15%. We are investing in sales and marketing initiatives
and our consulting service organizationa??s staff to respond to the
opportunities we see in the marketplace. These investments impacted our
expenses in this quarter but will position us well in quarters ahead to
achieve anticipated profitable growth. Certain expenses lines, such as
R&D, will remain higher, but expected revenue growth in coming quarters
should move us back towards historical profitability levels as expenses
as a percent of revenues are more in-line with historical levels.a??


John Kneisel, chief financial officer of Simulations Plus, added:
"During the quarter, we completed our implementation of FASB Accounting
Standards Update No. 2014-09, Revenue from Contracts with Customers
(Topic 606), a new guidance on Revenue Recognition.
ASC 606 had
minimal impact on our current revenue, we expect it may have some impact
on the timing of revenue recognition and service revenue margins on
certain contracts going forward, but we do not anticipate significant
changes to our annual historical service margins due to the minimal
number of projects for which the standard changed revenue recognition.a??
See also:
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